Before embarking on a review of David Gantz's excellent new
book, Regional Trade Agreements: Law, Policy and Practice [hereinafter
Regional Trade Agreements], (1) I should confess that I am not a great
fan of free trade agreements (FTAs). Despite having published articles
on the North American Free Trade Agreement (NAFTA), and although I have
served as a panel arbitrator in the first case presented under the
governmental dispute provisions under NAFTA Chapter 20, (2) I lack
enthusiasm for the "FTA Movement" that is so effectively
described and analyzed by Professor Gantz. (3) My lack of enthusiasm for
FTAs grows out of the education I received as a young lawyer in the
early 1970s, during which I readily embraced two shibboleths of the
Bretton Woods System: (4) the need to dismantle trade and other barriers
in order to promote economic growth worldwide, and the desire to carry
out this dismantling by multilateral, rather than regional or local,
means. This orthodoxy, preached by such eminent and persuasive advocates
as Georgetown University's Professor John H. Jackson (5) and
Columbia University's Jagdish Bhagwati, (6) was very convincing to
a young student of international economic law. Actively promoted by the
Western (i.e., non-Soviet) economic powers, the global, multilateral
approach to trade liberalization--led by efforts initiated under the
General Agreement on Tariffs and Trade (GATT)--resulted in an
unprecedented expansion of global trade, setting the stage for the era
of globalization that we are now experiencing. (7)

Over time, the challenge of promoting trade liberalization
increased, as governments imposed complex webs of non-tariff barriers,
and as stubborn protectionist obstacles resisted liberalization during
successive GATT trade rounds. (8) As David Gantz points out, the
consolidation of the European Union in the 1980s, coupled with
frustration over the lack of progress within the multilateral
negotiations of the GATT, led the United States to seek a new
approach--to promote regional solutions through FTAs--as a more
realistic avenue towards trade liberalization compared to the global,
multilateral trade negotiation rounds sponsored by the GATT. (9) This
new policy coincided with U.S. foreign policy under President George W.
Bush, which was intent on rewarding U.S. allies in the war on terrorism
with offers of trade advantages gained through increased access to U.S.
markets through free trade agreements. (10) This piecemeal, regional
approach also permitted the United States to add rules to the trade
agenda to accomplish several long-standing goals: the adoption of
international rules to promote and protect foreign investment, and the
adoption of rules governing trade in services, which were not added to
the GATT agenda until the entry into force of the Uruguay Round
Agreements and the formation of the World Trade Organization (WTO) in
1995. (11)

The impulse to adopt FTAs has thus advanced the jurisdiction of
what used to be referred to as the international trade regime. The term
"Free Trade Agreement" is a misnomer--used to signify NAFTA,
the most important FTA to which the United States is a party, as well as
most of the FTAs adopted by the United States--the U.S. model FTA
includes rules governing investment, intellectual property protection,
trade in services, environmental protection, and other subjects. (12)

Free trade agreements have thus become important tools in U.S.
foreign policy, underscoring the geopolitical implications of FTAs and
RTAs, which are barely mentioned, but are certainly recognized by Gantz.
(13) I consider NAFTA to be not just a trade agreement, but rather a
relationship agreement--an important, albeit tentative, strategic step
in the development of a structure to manage a permanent relationship
among North America's three largest nations. NAFTA's value
must be assessed under this broader perspective.

Unfortunately, while FTAs may increase trade between nations, the
increase comes at a price. Gantz's text points out how FTAs
complicate international trade, by creating a "spaghetti bowl"
of confusing tariff rates and other obligations that apply to exports
and imports depending on where the goods are from, or where they are
headed. (14) The result is a nightmare that businesses must confront and
navigate when they decide to export or import goods. (15)

In this confusing world of hundreds of FTAs and RTAs, we can be
thankful for Gantz's astute and reasonable voice as an antidote to
the confusion surrounding RTAs. Parts of this book have been reworked
from the extensive oeuvre on international trade law previously
published by Professor Gantz between 2004 and 2009. (16) Regional Trade
Agreements benefits from Gantz's extensive background as an
international lawyer and international trade practitioner for
twenty-five years in Washington, D.C. In 1993, Gantz joined the
University of Arizona law faculty, but in addition to his teaching and
scholarly research, he continued to consult on international trade
matters, serving as panel member (arbitrator) in five international
trade disputes conducted under NAFTA Chapters 11 (investment disputes),
19 (disputes over antidumping and countervailing measures) and 20
(government-to-government disputes). (17) His combination of academic
and practical experience is reflected in the text. Gantz deals with
practical problems and technical legal doctrines, while also addressing
some of the geopolitical implications of FTAs and providing background
on political economy.

Organized into three parts, the book begins with an initial part
(pages 1 to 78) entitled "Introduction to RTAs." (18) The
first chapter, very short, sets forth Professor Gantz's outline and
goals for the book. (19) Regional Trade Agreements does not pretend to
be a comprehensive treatment of all aspects of the FTAs that are
surveyed; this would be impossible in a text of fewer than 500 pages
(not counting annexes). Instead, Gantz addresses the most important
aspects of FTAs, striking a necessary balance between detail and
generality. Extensive research and citation to authorities provides
additional help for the reader interested in pursuing further detail.
Chapter Two, entitled "History, Pros and Cons of Regional Trade
Agreements," will be extremely useful for those persons who lack
expertise in the field of international trade law. (20) To justify
referring to this phenomenon as the "FTA movement," Gantz
presents the following statistics: according to the WTO, Mongolia is the
only country not party to at least one regional trade agreement; more
than 380 regional trade agreements have been notified to the WTO, with
more than half since 1995; over 205 such agreements are currently in
force. (21)

Chapter Three provides a useful summary, and analysis, of the GATT
and WTO rules that apply to RTAs. (22) GATT Articles V and XXIV create
exceptions that allow RTAs to deviate from the most-favored-nation (MFN)
principle that is the bedrock of the GATT. (23) Despite the important
deviation from MFN, Gantz notes that the exceptions have not been
applied strictly, and relatively few disputes brought to the WTO's
Dispute Settlement Body have involved alleged violations by RTAs of the
provisions of WTO agreements. (24) Gantz also gives an overview and
analysis of four of the most important RTA disputes. (25)

As a preamble to the detailed analyses of FTAs that comprise
two-thirds of the text, in Chapter Four, Gantz presents a survey of the
principle RTAs and RTA provisions. (26) This is a helpful section both
for the practitioner and the academic researcher. RTAs and FTAs are
complex, individually negotiated agreements that deviate in content, but
follow a general pattern. (27) This chapter presents a table with
detailed information on the many RTAs discussed in this book, which
facilitates comparisons and generalizations. (28)

Part II of Regional Trade Agreements will be of the greatest
interest to U.S. readers, as it describes and analyzes the fifteen FTAs
the U.S. government has negotiated with foreign

zzz governments. (29) As Gantz points out, each chapter is a
"standalone treatment of a particular FTA or group of
FTAs"--there is no attempt to provide a uniform comparison. (30)
Chapter Five gives a brief background on the political, legal, and
policy considerations behind the U.S. FTA program, including discussion
of the legislative fast-track/trade promotion authority under which the
U.S. government negotiates FTAs. (31) Chapter Six analyzes the most
important FTA the United States has signed, the North American Free
Trade Agreement (NAFTA) between Canada, Mexico, and the United States.
(32) It is a daunting task to deal with such a complex and important
agreement in only fifty pages of text. This is where Gantz's
intelligence as a trade expert is particularly helpful, as he is able to
explain and give background to complicated provisions without
confounding the reader. For non-international trade lawyers, the most
interesting part of this section will be the pages devoted to the
notorious obligations and dispute settlement provisions of Chapter 11,
dealing with investor protection. (33) In this concise overview, the
pages provide valuable insights, such as Gantz's astute observation
that Canadian and United States negotiators did not expect the Chapter
11 provisions to be directed against their governments because these
countries "maintained highly developed legal systems with
independent, non-corrupt, well-educated judiciaries...." (34) The
dispute settlement provisions of Chapter 11 were obviously intended to
keep the Mexican government from violating NAFTA's commitments, and
yet the Mexican government has been the defendant in fewer cases (16)
than have the governments of Canada (26) and the United States (19).
(35)

Other Chapters in Part II discuss the Dominican Republic-Central
America FTA (U.S. CAFTA-DR), with emphasis on the FTA as a development
tool, and RTAs in the Middle East and North Africa, with which the
United States is a party. (36) This part ends with the fascinating story
of a little-known agreement, the U.S-Vietnam Bilateral Trade Agreement
(VBTA), (37) which preceded Vietnam's accession to the WTO. (38) A
legacy of the Vietnam War, according to Gantz, the VBTA represents a
potentially powerful model of development agreement. (39)

Part III of Regional Trade Agreements gives a broad, comparative
overview of a wide range of RTAs, starting with the European Union
(which has become much more than a trade agreement or customs union),
the Southern Cone Common Market (Mercosur), the Central American Common
Market, the Organization of South East Asian Nations (ASEAN), the ASEAN
Free Trade Area, and the Southern African Customs Union (an agreement
Gantz argues is both unsuccessful and "deeply flawed"). (40)

The book ends with a cursory, one-page chapter of conclusions--a
bit of a disappointment given the richness of the subject and the
author's understanding of the mechanisms of the international trade
regime. (41) Nevertheless, Regional Trade Agreements is a valuable
contribution to the general literature on international trade law--a
useful overview of an important phenomenon in international economic
law. We can only hope that David Gantz will continue to add to the text
in future editions, as RTAs wax and wane, and that he will give us more
insights about whether FTAs are here to stay, and whether they represent
a beneficial force for the world economy--something about which I am not
entirely convinced. In the end, the geopolitical importance of FTAs, as
structures that engage regional interests and intrude into, but also
mediate, national interests, may outweigh the inefficiencies and costs
that these agreements bring to the business world.

(3.) GANTZ, supra note 1, at 7 (pointing out that "regional
trade agreements" (RTAs) may be a misnomer because many of the
agreements, such as the U.S.-Singapore Free Trade Agreement, belie the
term, and that eighty-four percent of all RTAs are FTAs while the rest
are customs unions or more limited agreements).

(4.) The term Bretton Woods System, named for the New Hampshire
resort at which the International Monetary Fund (IMF) and World Bank
Agreements were signed, refers generally to the collection of
international economic law agreements created at the end of the Second
World War to help rebuild the world's economy. R.J. BARRY JONES,
ROUTLEDGE ENCYCLOPEDIA OF INTERNATIONAL POLITICAL ECONOMY, VOL. 1, at
130-34 (2001). There is some difference of opinion whether the term
"Bretton Woods System" refers only to the World Bank, IMF, and
related financial organizations, or whether the term refers to the
panoply of international organizations fostered by the Western
industrialized countries. See id. at 130-38 (stating that the term
refers to "the international monetary regime that prevailed from
the end of World War II until the early 1970s"); Stephen Zamora,
Economic Relations and Development, in UNITED NATIONS LEGAL ORDER, VOL.
1, at 503, 514-15 (1995) (stating that the term applies to agencies
created after Bretton Woods, such as the General Agreement on Tariffs
and Trade (GATT)). I believe the latter is the more useful use of the
term: the IMF and World Bank regimes (and their spinoffs, such as the
regional development banks) generally compliment the regimes of the
GATT/WTO, WIPO, and other organizations.

(5.) See, e.g., John H. Jackson, Perspectives on Regionalism in
Trade Relations, 27 LAW & POL'Y INT'L BUS. 873, 874 (1996)
(stating how it is important that a credible multilateral
"mediator" exists to inhibit dangerous temptations in regional
blocs).

(7.) See World Trade Organization, World Trade Report 2007, at 199
(Dec. 4, 2007), available at
http://www.wto.org/english/news_e/pres07_e/pr502_e.htm (illustrating
that total world exports grew tremendously from $59 billion in 1948 to
$10 trillion in 2005).

(8.) See FRED LAZAR, THE NEW PROTECTIONISM: NON-TRADE BARRIERS AND
THEIR EFFECTS ON CANADA xiv-xv (1981) (explaining how "new
industrial policies" implemented by many governments created, to
some extent, new barriers to trade).

(9.) See GANTZ, supra note 1, at 14-17 (explaining the
"demonstration effect of European and Unites States' embrace
of a dual-track trade policy").

(10.) See Bernhard Speyer, Birth of a New Regime? U.S. Trade Policy
in the Context of the New National Security Doctrine (Nov. 6, 2003)
(unpublished participant report), available at
http://www.runder-tisch-usa.de/washington/site/reports/ 1wg_speyer.pdf.

(15.) See CUSTOMS MODERNIZATION HANDBOOK 204 (2005), available at
http://siteresources.worldbank.org/INTEXPCOMNET/Resources/
Customs_Modernization_Handbook.pdf (noting that the cost of proving the
origin for the Rules of Origin Requirements can amount to two or three
percent or more of the cost of the shipment).

(16.) A list of Gantz's articles is contained in the Preface
and Acknowledgements section. GANTZ, supra note 1, at xix-xx.

(17.) Curriculum Vitae, David A. Gantz, available at
http://www.law.arizona.edu/ faculty/facultypubs/documents/cv/41/41.pdf.

(18.) GANTZ, supra note 1, at 3.

(19.) Id. at 7-9.

(20.) Id. at 11.

(21.) Id. at 7. This chapter includes a short section on "The
Benefits and Costs of Regionalism;" the eight pages devoted to this
subject barely scratch the surface, as Professor Gantz acknowledges in
stating that this is "a brief overview of the debate." Id. at
17. Fortunately, there have been a number of balanced assessments of
NAFTA and of other FTAs, including the writings of Gary Hufbauer and
Jeffrey Schott that have been published by the Peterson Institute for
International Economics in Washington, D.C. See, e.g., GARY CLYDE
HUFBAUER & JEFFREY J. SCHOTT, NAFTA REVISITED: ACHIEVEMENTS AND
CHALLENGES (2004), available at
http://bookstore.piie.com/bookstore/332.html. This is an excellent
overview, published on the tenth anniversary of NAFTA's entry into
force.

(22.) See generally GANTZ, supra note 1, at 31-56 (explaining the
"RTAs under the GATT/WTO system").

(29.) See Office of the U.S. Trade Representative, Free Trade
Agreements, http://www.ustr.gov/trade-agreements/free-trade-agreements
(last visited Oct. 29, 2009) (listing the fifteen agreements, including
the U.S.-Canada Free Trade Agreement and the three FTAs with Colombia,
Korea, and Panama, which have not yet received governmental approval).

(39.) See id. at 300 (explaining that the VBTA could serve as
"an important force in encouraging further global trade
liberalization").

(40.) Id. at 455.

(41.) Id. at 457-58.

Reviewed by Stephen Zamora, Leonard B. Rosenberg Professor of Law,
University of Houston Law Center served as the Law Center's Dean
from 1995 to 2000. He is an expert on NAFTA, and in 1996, served as a
member of the dispute resolution panel that decided the first
government-to-government dispute under NAFTA. He is a member of both the
American Law Institute of the American Society of International Law, and
the American Society of Comparative Law. In 2006, he received the
highest distinction awarded by the Mexican government to a foreign
national, the Order of the Aztec Eagle, in recognition of his work in
promoting U.S.--Mexican understanding.

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